Wealth inequality

The basics

The main official source is a survey of households in Great Britain. Its latest results cover April 2020 to March 2022, so figures on this page are for Great Britain and that period unless stated. [1]

The survey counts four kinds of wealth. These are their shares of the total. [1]

Wealth is not income

Someone can have a high income and little wealth, like a well-paid young renter. Someone else can have a low income and a lot of wealth, like a pensioner who owns a valuable house. The two overlap, but wealth inequality is much greater than income inequality.

Shares and gaps: two ways to measure

A share is the slice of all wealth held by a group, such as the top 10%. A gap is the difference in pounds between one group and another. If everyone's wealth doubles, the shares stay the same but the gaps double.

Both things have happened in Britain. Shares have been broadly stable and the gaps have grown. [2] Much of the argument about wealth comes down to which of the two you think matters more.

How big is the problem?

No single number captures it, so it helps to look at several.

Not every measure points the same way

• The top's share has not been rising. The share of wealth held by the richest tenth of households has been broadly stable since the 1980s. [2] Estimates of that share run from 41% to around half, depending on how wealth is counted. [5] [2] Researchers who corrected for wealth missing at the top put it at around 47%, and also found it flat over time. [8]
• A century ago, wealth was far more concentrated. Before the First World War the wealthiest 1% of people in the UK held around 70% of personal wealth. That share fell dramatically between 1914 and 1979. The fall ended around 1980, and there is some evidence of a rise since. [9]
• Age explains part of the picture. People build up a pension and pay off a mortgage over a working life. Household wealth peaks when the head of the household is aged 65 to 74, then falls as pensions are drawn. [1]
• Most wealth is homes and pensions. Together they make up three-quarters of the total. Even for the wealthiest tenth, property and pensions are about three-quarters of what they hold. [1]
• Wealth has fallen since 2021. The Resolution Foundation estimates that household wealth fell by more than £2 trillion as interest rates rose, and that the gaps narrowed. [10] The official survey stops before this happened.

A caution about the numbers. The official results are more than four years old and were collected during the pandemic. In June 2025 the survey's status as accredited official statistics was suspended while the Office for National Statistics works to improve its quality. [1]

How did we get here?

There is no single cause. These are the explanations that come up most often.

1. Wealth grew much faster than the economy

   What happened

   In the mid-1980s, total household wealth was around three times the size of the UK economy. [2] By 2019 it was around seven times. [10]

   Why it matters

   When wealth is large compared with pay, the same shares mean bigger gaps in pounds. It takes more years of earnings to catch up, so saving from a salary counts for less and what you already own counts for more.

   What the evidence shows

   The gap between the top tenth and the middle was worth 38 years of typical full-time earnings in 2006–08. [2] By 2020–22 it was 52 years. [3]

2. Most of the growth came from rising prices, not saving

   What happened

   Homes, shares and pension funds rose in value over several decades. A Bank of England staff paper found that the rise in house prices relative to incomes between 1985 and 2018 could be more than accounted for by the long decline in real interest rates (interest rates after inflation). [11] From 2009 the Bank's bond-buying programme, known as quantitative easing, pushed asset prices up further. [12]

   Why it matters

   When prices rise, the gains go to people who already own assets, in proportion to how much they own. People who own nothing gain nothing.

   What the evidence shows

   The Resolution Foundation estimates that rising asset prices, not new saving, accounted for 60% of the rise in average family wealth between 2018–20 and 2020–22 [2], and for 53% of the rise since the start of the 2010s. [3]

   The Bank of England said in 2012 that the top 5% of households held 40% of the financial assets, outside pensions, whose value its programme had boosted. It also judged that without the programme most people in the UK would have been worse off, because the economy would have been weaker. [12]

3. Owning a home became the dividing line

   What happened

   Property is the largest part of household wealth. Older households who own may have benefited from rising house prices over their lifetime, while only 5% of renters have any property wealth at all. [1]

   Why it matters

   A mortgage turns monthly housing costs into an asset. Rent does not. So two households with the same income can end up with very different wealth.

   What the evidence shows

   The typical household that owned its home outright had wealth of £647,400. For those with a mortgage it was £404,700. For those who rented it was £40,800. [1]

4. Inheritances are growing

   What happened

   Inheritances have been growing as a share of national income in the UK since the 1970s. [4] As older generations' wealth has grown, so has the amount they can pass on.

   Why it matters

   An inheritance depends on who your parents are, not on what you do. The more it counts for, the more a person's prospects are shaped by the family they were born into.

   What the evidence shows

   For people born in the 1980s, the Institute for Fiscal Studies projects that inheritances will add 29% to lifetime income for those whose parents are in the wealthiest fifth, and 5% for those whose parents are in the least wealthy fifth. [4] A fifth are expected to inherit less than £10,000, and a quarter more than £280,000. [13]

   One complication: measured against their own lifetime income, high and low earners are projected to inherit similar proportions, around 16% and 15%. [4] So inheritance divides people more by family background than by earnings.

5. The gap between young and old widened

   What happened

   Between the 2008 financial crisis and the pandemic, the wealth gap between younger and older people widened. [10] In 2020–22 the typical household headed by someone aged 65 to 74 had £502,500. That was 33 times as much as one headed by someone aged 16 to 24. [1]

   Why it matters

   Some of this is normal. Older people have had longer to save. The worry is whether today's young adults will catch up when they reach the same age.

   What the evidence shows

   The Institute for Fiscal Studies found that people born in the 1980s had built up no more wealth than those born a decade earlier had at the same age, even though their parents were wealthier. [13]

   The fall in wealth since 2021 has narrowed the gap between young and old. But a lot of wealth remains with older households, and will pass down through inheritances and gifts. [10]

Who is affected most?

These are the groups with the least wealth. Figures are medians, meaning the household in the middle of each group.

Why is it hard to fix?

Few people argue that wealth should be spread equally. The harder questions are how much wealth concentration is too much, and what could be done without harming people who have simply saved for a home and a pension.

1. We can't see the top clearly

   The problem

   The official survey can under-represent the wealthiest households, and its estimates for the top 1% are uncertain. [1] One study put the missing wealth at nearly £800 billion. [6] The latest results are also dated, and the survey has lost its accredited status for now. [1]

   A possible fix

   Combine the survey with other evidence, as researchers have done with the Sunday Times Rich List. [6] The Office for National Statistics says it is developing a plan to bring its wealth statistics back to the standard needed. [1]

2. Most wealth is ordinary homes and pensions

   The problem

   Property and pensions make up three-quarters of household wealth on the official measure [1], and 80% on the Resolution Foundation's. The Foundation warns that higher taxes on wealth would be likely to fall on pensioners and homeowners in the south of England, or their families, and not only on the super-rich. [3]

   A possible fix

   There are two different routes. One is to focus only on the very largest fortunes, which is the idea behind an Extreme Wealth Line. The other is to help people with few assets to build some, mainly through home ownership and pension saving.

3. Asset prices follow interest rates

   The problem

   Much of the growth in wealth came from asset prices rising as interest rates fell. [11] The Bank of England sets interest rates to control inflation, not to manage who owns what. Its own assessment is that its bond-buying raised asset prices, but that most people would have been worse off without it. [12]

   A possible fix

   Leave interest rates to do their job, and deal with the effects on wealth through other policies such as tax. Higher interest rates since 2021 have already reversed part of the rise. [10]

4. Passing wealth on is something most families want

   The problem

   Most parents want to help their children, and inheritances are projected to grow. [4] But the more they count for, the more they favour people whose parents are wealthy.

   A possible fix

   This is mainly a question of how inheritances and gifts are taxed, which the tax page covers. The Institute for Fiscal Studies adds a caution: bigger inheritances do not by themselves tell us whether inheritance is making inequality worse. That depends on who receives them, and when. [13]

Where people disagree

The figures above are mostly agreed. What they add up to is not.

Sources and further reading

These sources support the facts and examples on this page. They explain the evidence, but they don't all share the same view of how serious the problem is or what should be done about it.

1. Office for National Statistics: Household total wealth in Great Britain: April 2020 to March 2022 (2025) — how much households own, what it is made up of, and how it varies by wealth group, age, tenure, work status and region. Collected during the pandemic; accredited status suspended in June 2025.
2. Resolution Foundation: Before the fall – the distribution of household wealth in Britain and the impact on families (2025) — the long-run growth of wealth, the stability of shares, the widening gap in pounds, and how much of the rise came from asset prices.
3. Resolution Foundation: Britain's huge wealth gaps mean a typical worker would need to save more than a lifetime's worth of their earnings to become wealthy (2025) — the gap expressed in years of typical earnings, asset-price gains since the 2010s, and the warning about who higher wealth taxes would fall on.
4. Institute for Fiscal Studies: Inheritances and inequality over the life cycle – report summary (2021) — the growth of inheritances since the 1970s and projections of how much they will add to lifetime income, by parental wealth and by earnings.
5. Office for National Statistics: Privately owned wealth in the UK – freedom of information response (2025) — the shares of household wealth held by the wealthiest 1%, 10% and 50% of households.
6. Advani, Bangham and Leslie: The UK's wealth distribution and characteristics of high-wealth households, CAGE working paper 576 (2021) — the wealth missing from the official survey at the very top, estimated using the Sunday Times Rich List.
7. Express & Star (Press Association): Rich List 2026 – who are the wealthiest people in the UK? (2026) — the number of UK billionaires counted by the Sunday Times Rich List in 2026.
8. CAGE, University of Warwick: Official statistics underestimate wealth inequality (2022) — the share of the wealthiest tenth after correcting for missing wealth, and differences in wealth between ethnic groups.
9. Alvaredo, Atkinson and Morelli: Top wealth shares in the UK over more than a century (2018) — the share of personal wealth held by the wealthiest 1% from 1895, its fall between 1914 and 1979, and what has happened since.
10. Resolution Foundation: Inequality control – why wealth inequality has not increased while asset prices have soared and what that means for the future (2024) — why shares stayed stable while wealth grew, the gap between young and old, and the fall in wealth since 2021.
11. Bank of England: Staff Working Paper No. 837 – UK house prices and three decades of decline in the risk-free real interest rate (2019) — the part played by falling real interest rates in the rise of house prices. Sets out its authors' views, not necessarily the Bank's.
12. Bank of England: The distributional effects of asset purchases (2012) — how its bond-buying programme affected asset prices, who holds those assets, and its judgement of the overall effect.
13. Institute for Fiscal Studies: Inheritances and inequality within generations (2020) — how much people born in the 1980s are expected to inherit, how their wealth compares with earlier generations, and the limits of what inheritance figures show.